The firm expects a net loss of 25 billion yen (208 million dollars), reversing an earlier estimate of a 10 billion yen profit.

"Now we expect a second consecutive net loss following a 312 billion yen loss the previous year," a company spokesman said.

NEC Corp. also downgraded its pre-tax profit forecast to 60 billion yen from 65 billion yen but left its estimate of sales unchanged at 4.68 trillion yen.

The company said the revision was due mainly to a fall in the value of its securities investments of around 20 billion yen.

The Nikkei-225 average of the Tokyo Stock Exchange has lost almost 30 percent over the financial year just ended, eroding the value of share portfolios held by companies.

NEC said the revision was also due to a loss of approximately 16 billion yen due to an adjustment to deferred income tax assets resulting from the introduction of a new local tax and an increase in other taxes.

Shares in the firm earlier fell 10 yen or 2.5 percent to close at 392 yen on the Tokyo Stock Exchange on expectations the firm would downgrade its earnings forecast. The Nikkei 225 index lost 1.44 percent to end at 8,131.41 points.

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